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  • Writer's pictureVirtus Prosperity

Vietnam's import and export situation in the period of 2022 - 2023

According to the regulations in Article 28 of the 2005 Commercial Law on import and export of goods: "Import and export are the buying and selling activities of Vietnamese traders with foreign traders under contracts for the purchase and sale of goods, including temporary import for re-export and temporary export for re-import, cross-border transfer of goods."

In essence, import and export activities have the following main characteristics:

+, A large and difficult-to-control market for trading.

+, Influenced and dominated by various factors such as policies, economy, politics, and laws of countries.

+, Payment in foreign currency, and goods are transported across national borders and must comply with international trading practices.

+, The state directly manages export and import activities through policy tools such as taxation policies, quotas, regulations on export and import goods, and other legal documents.

Roles of export and import:

In the economic and social activities, import and export play a very important role. It not only helps promote economic development but also solves the problem of supply and demand for the production of the people. Specifically, import and export have several key roles, such as:

Roles of export activities:

Export is a crucial activity for the economy of every country, including Vietnam. Export opens up opportunities such as:

+, Expanding the business market and generating revenue for enterprises.

+, Enhancing brand recognition and positioning in the international market.

+, Bringing in a large source of foreign currency for the country, promoting global economic development.

Roles of import activities:

Similar to export, import also plays a vital role in the economic development of a country. Importing just enough, without excess, brings some benefits such as:

+, Solving the problem of scarce goods: For countries that cannot produce certain items on their own, importation is the only way to solve the scarcity of goods domestically.

+, Providing a diverse source of goods for the domestic market.

+, Stimulating domestic enterprises to improve and adapt to competition, as imported goods invisibly create competition within the country.

Looking back at 2022:

According to the General Statistics Office, after more than 2 difficult years due to the COVID-19 pandemic, the total import-export turnover for the whole year of 2022 reached a record high of $732.5 billion, an increase of 9.5% compared to 2021. The trade balance in goods in 2022 showed a surplus of $11.2 billion.

In the early months of 2022, the COVID-19 pandemic continued to have complex developments and hurt economic activities, especially in the import and export of goods. Countries tended to use domestic products instead of imported goods, particularly in the agricultural and aquatic products sector. 2022 also took place in the context of rapid and unpredictable changes in the global economy, increasing risks to financial markets, currencies, energy security, and global food security.

However, the second half of the year witnessed a strong recovery of the economy as effective control measures were implemented and the pandemic was gradually overcome. The GDP growth for the whole year of 2022 was estimated to reach 8.02% compared to the previous year, the highest growth rate in the period from 2011 to 2022. In this overall picture, one of the highlights was the import-export activities, with the total import-export turnover reaching a record-breaking $700 billion milestone.

Import and export in 2023:

According to the General Statistics Office, in September 2023, the total import-export turnover was estimated at $60.53 billion, decreased by 2.5% compared to the previous month and increased by 3.6% compared to the same period last year. The total import-export turnover reached $497.66 billion, decreased by 11% compared to the same period last year, with exports decreasing by 8.2% and imports decreasing by 13.8%. The trade balance in goods for the first 9 months of 2023 was estimated to show a surplus of $21.68 billion.

Regarding the structure of export commodity groups in the first 9 months of 2023, the fuel and mineral group is estimated to reach $3.21 billion, accounting for 1.2%; the processed industrial group is estimated to reach $229.22 billion, accounting for 88.3%; the agricultural and forestry product group is estimated to reach $20.6 billion, accounting for 7.9%; the aquatic product group is estimated to reach $6.64 billion, accounting for 2.6%.

Regarding the structure of import commodity groups in the first 9 months of 2023, the raw materials group is estimated to reach $223.08 billion; accounting for 93.7%. In which the machinery, equipment, and spare parts group accounts for 45.5%, while the raw materials group accounts for 48.3%. The consumer goods group is estimated to reach $14.91 billion, accounting for 6.3%.

According to Virtus Prosperity's experts, the decline in industrial production and import-export activities in the past 9 months was due to major economies, which are Vietnam's export partners such as the United States and the EU, reducing spending on regular and luxury products, leading to a decrease in order volumes. The reopening of the Chinese market also creates competitive pressures for similar types of exports from Vietnam. Furthermore, businesses still face challenges due to reduced foreign orders, limited domestic purchasing power, high input costs, and difficulties in accessing credit...

Therefore, in the fourth quarter of 2023, it is forecasted that export activities will continue to thrive as inflation in major economies such as the United States and Europe tends to cool down, and inventory levels in countries are gradually decreasing. Additionally, there will be a high demand for goods during the year-end holidays. Moreover, Vietnam will also benefit from multinational corporations shifting their production from China to Vietnam.

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